Universal Corp. (NYSE: UVV), a Richmond tobacco company that has expanded to plant-based ingredients in recent years, said this week it has forged a power purchase agreement with Clearway Energy Group LLC to procure about 70,000 megawatt-hours per year from a solar facility to be built in Texas.
"This is a meaningful step towards meeting our science-based environmental target to reduce operational greenhouse gases emissions by 30 percent by 2030," George Freeman, Universal’s chairman, president and CEO, said in a statement. "When the solar project is operational, we expect to hit this target for our U.S. operations ahead of schedule.”
Terms of the agreement were not disclosed.
Construction on the new solar facility will begin this year and is expected to deliver in 2026. Universal said the agreement is expected to reduce its greenhouse gas emissions by roughly 15,000 metric tons, which accounts for about 45% of its direct and indirect emissions in the U.S. It added that its contracted portion of the Texas project is intended to address emissions from 100% of its annual purchased electricity demand in the U.S.
San Francisco-based Clearway Energy Group owns and operates more than 8 gigawatts of renewable and conventional energy across the country.
Universal, founded in 1886, is the world’s leading global supplier of leaf tobacco and provides support, research and financing to tobacco farmers. It does not manufacture consumer tobacco products. Since 2018, it has set out to acquire several plant-based product companies, include fruit and vegetable ingredient processor FruitSmart Inc. and dehydrated produce processing company Silva International. It posted $2.56 billion in revenue and $124.05 million in net income across its fiscal 2023, which ended March 31.
Its share price is up 7.7% in the past 12 months, trading Wednesday afternoon at $58.59.